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[kraut]

"Dealers sustaining MSRP as demand for new Harleys grows: report


By:  Holly J. Wagner
Email|Print|ShareDel.icio.usDiggRedditFacebook|Save|LicensePrices for new Harley-Davidson motorcycles are improving, partly as a result of lower inventories and higher demand, according to an analyst’s report.

Demand in the second quarter of this year is up 4 percent to 5 percent on the heels of a 25 percent demand increase in first quarter, brought on by early spring weather, according to Baird Equity Research analyst Craig Kennison. The Baird report is based on a survey of 40 Harley dealers nationwide.

Surveyed dealers reported that as demand increases, discounts are becoming more scarce. “For the first time since 2008, more dealers tell us that bikes are selling at/above MSRP than below MSRP,” Kennison wrote. “Dealers understand that Harley has little capacity to increase production further in 2012, so these dealers are making the most of what they have.

“Used bike prices are stronger, too,” he stated. Tight supply and high demand for new models has helped drive up prices for pre-owned vehicles, Kennison wrote. “Big picture, we believe efforts to revitalize used bike prices have stimulated demand for new bikes - a sustainable trend. Dealers reported an 8 percent to 10 percent increase in used bike retail.”

Harley-Davidson Financial Services is holding to tighter consumer lending standards than during boom years, but is sending some rejected credit applications through a second time “for consumers willing to downsize or modify the terms of the loan to meet HDFS standards,” according to the report.

U.S. dealer inventory is at its lowest levels in a decade, with an average of 54 new bikes per dealership, against 124 per dealer in 2006.

The Motor Co.’s growth opportunities are what analysts believe to be underserved U.S. markets (women and minorities) and overseas. “We believe Harley-Davidson must attract more women, minorities and youth riders without alienating its base. Women represent just 12 percent of buyers today but have expanded in number by 14 percent since Harley-Davidson launched a [women’s] rider training program in 2000. Harley-Davidson has a similar opportunity to penetrate the African-American and Hispanic-American markets,” Kennison wrote. The men’s rider market posted a 9 percent growth rate by comparison, he noted.

Kennison noted that foreign sales accounted for just 19 percent of sales in 2004, but reached 36 percent last year. Overseas, “dealers sell less than 100 bikes [per] year in Europe versus over 300 in the U.S., suggesting opportunity,” he wrote. “Harley-Davidson recently opened dealerships in China and India, and is expanding in Brazil, but currently relies on Japan, Canada and Europe for most international volume.”

Posted by Holly Wagner"


(source: dealernews.com)

[dayne66]

When the dust settled......the deal on my new 2012 FLHXSE3 was about $1500 or so below MSRP, and included first service....and I kept about $2000 of add-ons and/or originals that would have gone with the trade if I sold it privately.

[Rio]

Blanket statement, totally depends on the market and the individual stores supply!